Philips aims to broaden the reach of its digital patient monitoring platforms, from inside the hospital out to the home, through a $2.8 billion acquisition deal for BioTelemetry and its wearable heart-tracking devices.
BioTelemetry, alongside its artificial intelligence-based analytics and other services, helps remotely monitor and diagnose at least 1 million cardiac patients each year. It’s a business that brought in $439 million in sales in 2019, and one that Philips expects to grow by more than 20% in the next four years—especially as the COVID-19 pandemic continues to push patients away from clinics and hospitals and toward telehealth solutions.
Philips has signed on to pay $72 in cash for each of BioTelemetry’s outstanding shares, representing a 16.5% premium over the company’s most recent closing price. The companies expect to complete the deal in the first quarter of 2021.
“The acquisition of BioTelemetry fits perfectly with our strategy to be a leading provider of patient care management solutions for the hospital and the home,” Philips CEO Frans van Houten said in a statement.
“BioTelemetry’s leadership in the large and fast-growing ambulatory cardiac diagnostics and monitoring market complements our leading position in the hospital,” van Houten added. “Leveraging our collective expertise, we will be in an optimal position to improve patient care across care settings for multiple diseases and medical conditions.”
Philips hopes to see strong gains after linking BioTelemetry’s heart monitors up with its digital platforms and larger international sales force. The medtech giant also plans to absorb the company’s 1,900 employees into its connected care division.
About 85% of the Pennsylvania-based BioTelemetry’s portfolio focuses on the diagnosis of abnormal heartbeats while people conduct their daily lives, using wearables to detect intermittent arrhythmias. The company also works with biopharma partners to provide monitoring services during clinical trials.
Analysts at Bernstein said they believe the business will fit nicely within Philips’ key driver of growth. As a leader with a 40% global market share in ICU monitoring, BioTelemetry’s products provide a solid foothold for expanding to other settings.
“Through continued innovation, we have developed the world’s largest remote cardiac monitoring services network,” said BioTelemetry President and CEO Joseph Capper. “Combined with Philips’ current patient care management portfolio, innovation strength and global scale, we are perfectly equipped to address the rising demand for telehealth and remote monitoring solutions.”